Interleukin 2 and other cytokines dramatically influence the immune response and therefore understanding the molecular basis of cytokine signal transduction should provide important insights into lymphocyte activation. To this end, we cloned a new protein tyrosine kinase, termed JAK3 and showed that it is a critical element in signalling via the subfamily of cytokine (IL-2, IL-4, IL-7, IL-9, and IL-15) receptors that use the common gamma chain (gammac). We further showed that whereas JAK3 binds gammac, JAK1 binds the IL-2Rbeta. X-linked severe combined immunodeficiency (X-SCID) is due to mutations of gammac. We demonstrated that several gammac mutations result in the failure of this subunit to bind JAK3, whereas reconstitution of cell lines with gammac mutations with the wild type allele restores the ability to activate JAK3 and JAK1. The disease X-linked combined immunodeficiency (X-CID) is also due to a mutation of gammac. This allele binds JAK3 but does so at much reduced efficiency and this binding correlates with the reduced severity of this immunodeficiency. In addition, we have also now identified patients with SCID who lack JAK3 indicating that JAK3 and its function appear to be critical in the development of the immune system. We have also investigated cytokine activated transcription factors, in particular STAT protein which are tyrosine phosphorylated transcription factors that contain SH2 domains. We have shown that IL-2 activates STAT3 and STAT5. IL-12 is a cytokine that has profound effects on T lymphocyte. To better understand its mechanism of action, we have also investigated IL-12 signal transuction and compared it to IL-2 signaling. We demonstrated that it activated JAK2 and TYK2 Janus kinases and activated the STAT4 transcription factor.It is hoped that understanding the precise mechanisms involved in cytokine signaling will provide avenues for the development novels agents that can regulate the immune response in a therapeutically desirable manner.